Release Explanation: The index, comprised by the Bank of England, measures the number of mortgages approved for the purchase and refinance of homes throughout the United Kingdom. A higher number of mortgage approvals signal an increase in growth from all areas of the economy. The U.K. is heavily dependent on its financial sector for jobs and tax revenue, and a healthy increase in mortgages is indicative of stronger banking needs.
TheLFB-Forex.com Trade Desk Thoughts: Net lending to individuals dropped to the lowest level on record in March. The number came in at £0.9B, much lower than what analysts’ expected. “The number released for the month of February was revised higher, to £1.5B. At the same time, the report showed that 39K mortgages loans were approved in March,” TheLFB-Forex.com Trade Team said.
“The March lending report indicates a troubled financial system, creating less and less credit. To some extent, it is still unsure if the strong rate cuts made by the BoE have affected the U.K. financial system in any way,” TheLFB-Forex.com Trade Team said.
Forex Technical Reaction: The pound traded on weak momentum during the overnight session, but gained 60 pips just ahead of the 4:30 releases